Human capital investment and globalization in extortionary states
Humankapitalinvestitionen und Globalisierung in Ausbeutungsstaaten
Fredrik Andersson () and
Kai Konrad ()
No FS IV 02-01, Discussion Papers, Research Unit: Market Processes and Governance from Social Science Research Center Berlin (WZB)
This paper considers education investment and public education policy in closed and open economies with an extortionary government. The extortionary government in a closed economy chooses an education policy in order to overcome a hold-up problem of time-consistent taxation similar to benevolent governments. The two types of government differ in their education policies if highly productive labor is mobile. Extortionary governments. incentives for a policy that stimulates higher private education efforts vanish; instead they have incentives to prevent individuals from mobility-increasing education investment. Tax competition therefore reduces hold-up problems of time-consistent extortionary taxation, but introduces other distortions that reduce workers. utility.
Keywords: Migration; education; globalization; commitment; time consistent income taxation (search for similar items in EconPapers)
JEL-codes: H21 H23 (search for similar items in EconPapers)
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Journal Article: Human capital investment and globalization in extortionary states (2003)
Working Paper: Human Capital Investment and Globalization in Extortionary States (2002)
Working Paper: Human Capital Investment and Globalization in Extortionary States (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:wzbmpg:fsiv0201
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